Empty rooms have always been a problem for hotels, especially during off-peak seasons. Besides the lost revenue opportunities, hotel operators have to contend with fixed costs like staff wages, insurance premiums, and marketing expenses.
One way to solve this problem would be to match unfilled inventory with a market of last minute vacationers. We already know that this market exists. Hotel Tonight, a San Francisco based startup, has developed a hotel booking mobile app catering to spur-of-the-moment travelers. It appears to be doing very well, having raised a USD 23M Series C round in June last year.
Now, Hong Kong startup HotelQuickly has brought a similar concept to Asia. Launched in March this year in Thailand, Hong Kong, Singapore, Taiwan, Indonesia, and Malaysia, the iOS and Android app has almost 200 hotels available for booking. It isn’t the only one getting into the act — CheckInTonight is also hoping to attract vacationers to book accommodation on its platform.
There’s no better time to capitalize on an idea like this. While Hotel Tonight is expanding outside of the United States — Europe, and not Asia, appears to be its next destination. This leaves a possibly unmet demand in Asia, as we’re certainly seeing a lot of intra-Asia travel to hotspots like Bali, Phuket, and Singapore.
HotelQuickly fits a classic ploy that has been honed to perfection by opportunistic entrepreneurs: Find an idea that is working well in the West, figure out if it’s viable in Asia, and replicate the idea there. The exit strategy is also clear: Hope that you get acquired by a competitor or a larger travel site.
While it’s challenging to recreate a Facebook or Google in parts of Asia, the hospitality sector, which is riding on Asia’s thriving reputation as a vacationer’s paradise, holds a lot of potential for replicating ideas.
HotelQuickly’s five co-founders know this game very well — two of them were from Rocket Internet after all. Christian Mischler was the former COO of FoodPanda while Raphael Cohen was the managing director of FoodPanda Vietnam.
Tomas Laboutka (CEO), Michal Juhas (CTO) and Mario Peng (CFO) round up the rest of the team, which has so far raised USD 500k from private investors in US, Europe, and Asia. The team can’t reveal names yet as they’re still in the midst of fundraising.
Tomas tells me that the idea to do this startup first emerged in July last year. From then on, the company hired a team of developers that worked remotely from Brazil, Pakistan, and Thailand. While having a team in disparate locations was challenging, the arrangement sped up execution by taking advantage of varying time zones to work around the clock — sort of like passing a baton.
Getting the development process down pat is important for a tech-oriented startup like HotelQuickly. Its mobile backend compares rates and displays the hotel rooms with the best value on the app. Payment on the app has to be as seamless as possible despite the lack of an ubiquitous payment gateway across Asia.
Then there’s the matter of developing a web platform for hoteliers to indicate the rooms they have available and the rates they’re going for. The platform also facilitates real-time or delayed money transfer from the startup to the hotel, with the company collecting a commission before passing on the rest.
With the technology is more or less in place, the startup can start devoting some effort to marketing the app. It has set other parts of Asia in its sights.